What is it?
Council tax benefit, payable to eligible households in part or total fulfilment of council tax, was abolished as a national benefit and the funding (minus ten per cent) devolved to councils in order to establish localised council tax support schemes.
When does this happen?
Councils began to administer local council tax schemes from April 2013.
What is the impact?
As well as reducing funding for council tax support by ten per cent, the government has announced that pensioners currently in receipt of council tax benefit must continue to receive assistance under localised council tax support schemes. This means that many working-age households will be required to pay council tax for the first time.
There is currently no provision to cope with financial shocks that lead to an increase in the demand for council tax support locally, such as the closure of a major local employer.
London Councils remains of the view that council tax support localisation is a mechanism by which government is asking councils not only to deliver ten per cent savings in the administration of the national council tax benefit scheme but to take on significant future financial risk.